U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 18418 /October 17, 2003

The United States Securities and Exchange Commission announced today that on October 9, 2003, Robert Burr ("Burr") pleaded guilty to fraud charges brought against him by the State of North Carolina and was sentenced to a term of at least 14 years in prison. In June 2003, Burr was arrested during a joint action between the North Carolina Securities Division and the Commission. During the joint operation, the Receiver appointed in SEC v. Benjamin Franklin Cook [3-99CV05701-R, USDC, NDTX (Dallas Division)] seized assets acquired by Burr as a result of recent fraudulent activities.

Burr and a company he controlled, Cornerstone Management, L.L.P., are both subject to judgments in excess of $4 million in the Cook matter. These judgments arise from Burr's participation in the Dennel Finance Limited ("Dennel") fraud, a Ponzi scheme master-minded by Phoenix, Arizona resident Benjamin Franklin Cook. The Dennel scheme, which centered around the offer and sale of non-existent prime bank securities, bilked investors of approximately $46 million before the Commission shut it down in March 1999 through an emergency action in District Court. [LITIGATION RELEASE NO. 16089].

On June 22, 2000, District Court Judge Jerry Buchmeyer of the Northern District of Texas granted the request of the Commission and the Court-appoint Receiver to place in receivership all assets of Burr and several entities he had created to conceal funds and property obtained through the Dennel scheme. On June 25, 2003, Judge Buchmeyer granted a freeze of assets obtained as a consequence of Burr's additional fraudulent conduct in North Carolina and expanded the Receivership to include new entities created by Burr and other persons involved in the additional fraud. On the same day, while the Receiver seized real estate, vehicles and other property accumulated by Burr and others, agents of the North Carolina Securities Division arrested Robert Burr and his brother, Daniel Burr.

In addition to the charges brought by North Carolina, Burr still faces sentencing in connection with criminal charges brought against him by state of Arizona for his participation in the Dennel scheme. Burr pleaded guilty to two counts of Fraudulent Schemes and Artifices and agreed to make $4.9 million in restitution in the Arizona case. Burr's three-to-10 year sentence in the Arizona criminal case will run concurrently with Burr's incarceration in North Carolina.

Burr was also briefly incarcerated in Seagoville Federal Detention Center in Seagoville, Texas, based on an order of contempt issued in the Commission's action. The Commission and Receiver have since discovered that Burr was apparently perpetrating the additional fraudulent scheme during the period of his incarceration in federal prison.